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🇰🇷 South Korea /Economy & Trade

South Korea eyes September for second National Growth Fund sale after initial sell-out

From Hankyoreh · () Korean

Translated from Korean, summarized and contextualized by DistantNews.

At a glance

News Sources not specified Context piece
  • South Korea plans to offer additional sales of the popular National Growth Fund as early as September, following its initial sell-out.
  • The fund, designed for public participation, saw 87% of its 600 billion won ($430 million) offering sold on the first day.
  • Financial authorities are considering adjustments to the sales method and potentially increasing the additional supply, aiming to accommodate strong public demand.

South Korea's financial authorities are preparing to launch a second round of the National Growth Fund, with sales potentially beginning as early as September. The fund, aimed at encouraging public savings and investment, proved immensely popular upon its initial release, selling out rapidly.

We will prepare and launch a second round of the National Growth Fund.

— Lee Byung-geolFinancial Services Commission Chairman Lee Byung-geol announcing the plan for a second offering of the fund on YouTube.

The initial offering of 600 billion won ($430 million) was nearly depleted on its first day of sales, May 22, with 87% of the total volume sold. The remaining units were fully sold within five business days. This overwhelming demand prompted the Financial Services Commission (FSC) to decide on a supplementary offering in the latter half of the year, a move not originally planned.

FSC Chairman Lee Byung-geol officially announced the upcoming second tranche of the fund on the YouTube channel 'Sampro TV.' While the exact amount of the additional supply has not yet been determined, the FSC is considering offering a volume similar to the initial 600 billion won. The final decision will take into account factors such as the potential for income tax deductions and the government's fiscal capacity.

We are currently gathering opinions from the first sales partners regarding additional supply. We will proceed quickly once the details are finalized.

— FSC officialAn official from the Financial Services Commission commenting on the process of preparing for the second sale.

Adjustments to the sales process are also under consideration. During the first sale, online sales through securities firms lagged behind the rapid sell-out of offline bank channels. To address this, the FSC may explore increasing the proportion of online sales for securities firms and boosting offline sales for banks. Additionally, there is a possibility of expanding the portion reserved for lower-income individuals, as the initial offering, which set aside 20% for those earning under 50 million won annually, saw a higher actual participation rate of 38.6% from this demographic.

We are also considering the option of additional supply at the level of the existing supply volume.

— FSC officialAn official from the Financial Services Commission discussing the potential size of the additional fund offering.
DistantNews Editorial

Originally published by Hankyoreh in Korean. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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